Renovation and Rehab Loans
 

This is a fantastic mortgage program for investors. It’s designed to finance properties that normally would be passed upon by lenders due to the property condition. Distressed, abandoned and foreclosed properties work very well on these programs, even unfinished builder walk out properties are allowed. The rehabilitation can be as minor as one project such as installing new cabinets, remodeling a bathroom, replacing the roof, or installing a pool to a complete restoration.

Purchase or refinance AND rehabilitate a property all in ONE LOAN with one set of closing costs. The loan begins with a construction phase which will be a set period of time, such as, three, six or nine months, determined by the contractor or appraiser. During this time, the borrower will pay interest only on the funds used and disbursed. At closing, your refinance payoff or lot purchase will be paid off. As the rehabilitation is completed and you or your contractor request a draw then an inspection will be completed. Once the inspection is received and approved by you, the lender will approve the release of funds and mail or wire the funds to you. Once all the draws have been released and the title company will do one final title check to ensure all potential liens have been paid. The title company will update the title policy and you will sign a modification agreement converting your loan to the permanent mortgage terms, such as, a 5 year or 30 year fixed mortgage.

The appraisal is based on the after improved value. Some programs will base the Loan to Value off the appraised value and not the sales price plus rehabilitation. This allows the closing costs may be rolled in which lessens your out of pocket at closing. The rehabilitation can be as minor as one project such as installing new cabinets, remodeling a bathroom, replacing the roof , or installing a pool to a complete restoration.

90% financing for investors
95% financing for second homes and owned occupied